Asian Paints to Enhance Manufacturing Capacity

Asian Paints Ltd is investing around Rs 4,000 crore for setting up two manufacturing plants, in Karnataka and Andhra Pradesh. Ashwin Choksi, chairman of the paints major, has stated that “the company would be investing in phases at both these facilities to enable it to service the future demand adequately.” The company has completed land procurement in both the states during the last fiscal and has taken possession of the identified land.

As per the company’s revised report provided to BSE, it will set up a paint manufacturing plant with a maximum capacity of 5,00,000 kilolitre per annum, in phases at Visakhapatnam in Andhra Pradesh at an approximate revised investment of Rs 1,850 crore. “The approximate amount that would be invested by the company in phases over a period of 12 years from the date of commencement of construction, including the cost of land, would be Rs 1,785 crore,” the report states. In addition to this, the company will invest about Rs 2,300 crore to set up a manufacturing facility with a maximum capacity of 6,00,000 kilolitre per annum in Mysuru, Karnataka.

Asian Paints sees great potential for its various businesses, given the large impetus being put on infrastructure development and urbanisation through creation of smart cities. “We are confident of converting this potential into reality, and as a mark of this confidence the company has initiated work on setting up new manufacturing facilities,” Choksi says.

To this end, the company has informed BSE that it would expand manufacturing capacity of its two units based at Sriperumbudur in Tamil Nadu and Ankaleshwar in Gujarat.

“The company is proposing to increase its water-based paint manufacturing capacity at its plant situated at Sriperumbudur, Tamil Nadu from 1.4 lakh kilolitre per annum to 2 lakh kilolitre per annum.”
Further, the company is also proposing to alter its product mix to augment manufacturing capacity of synthetic resins and emulsions at its manufacturing facilities at Ankaleshwar, Gujarat by 35,000 MT. With respect to the investment required for capacity expansion, the company has put forward a note, “The details of the capital expenditure for the aforementioned expansion would be intimated on receipt of necessary approvals from the regulatory authorities.”

During 2015-16 the company had invested resources to augment its manufacturing capacities, to be in a position to support increased future demand in a timely manner. The expansion at Rohtak plant in Haryana, to double capacity from the existing 2,00,000 kilolitre per annum to 4,00,000 kilolitre per annum, was successfully completed. The company is now focusing on ramping up and stabilising output from the plant.